Brazilian president calls for $26 billion in port investment

Friday, December 07, 2012

The Brazilian government on Thursday indicated it will invest $26 billion into its congested ports network to make them more efficient and maximize the country’s economic growth potential.
Probably the most significant aspect of the announcement, made by President Dilma Rousseff, is that port licenses will be granted to the group that offers to charge the lowest handling cost for the greatest volume of cargo, rather than the company willing to pay the government the most for port rights, Reuters reported.
"We want to increase the efficiency of Brazilian ports with this partnership, which will make our exports more competitive and increase production," Rousseff said. "We want an explosion of investment through this partnership with the private sector."
The overall investment needed will have to come from public and private sources, she said.
Some have questioned whether the investment will actually come to fruition, noting that past initiatives to improve the nation’s ports have largely failed. But the need to improve is clear - Brazil is the world's largest exporter of coffee, sugar, beef, orange juice and ethanol, the second largest exporter of soybeans and iron ore, according to Reuters.
Ports tapped for modernization include Rio de Janeiro, Paranagua, Brazil's main soybean port, Porto Alegre Itaqui, Pecem, Suape and Santos. APM Terminals and DP World are building nearly 5 million TEUs of capacity at Santos, the busiest container terminal in South America.